Stocks Turn Mixed at Session's Half; April Manufacturing Slows, M&A Supports


Stocks are mixed in mid-day trading after a strong start following news late last night that al-Qaeda leader Osama bin Laden was killed over the weekend by U.S. Special Forces. Adding to the mix is a spurt of M&A activity and new data showing that manufacturing activity declined last month.

In a televised address to the nation last night, President Obama said "the United States has conducted an operation that killed Osama bin Laden, the leader of al Qaeda." The news prompted ad-hoc celebrations outside the White House and in New York City.

In the latest economic data releases, April's ISM manufacturing index dips to 60.4 from 61.2 in March. Economists surveyed by MarketWatch had forecast the index to dip to 59.5.

In company news:

Teva Pharmaceuticals Industries Ltd ( TEVA ) said it will buy Cephalon Inc. ( CEPH ) for $6.8 billion, and Community Health Systems Inc. ( CYH ) continued its pursuit of Tenet Healthcare Corp. ( THC ) by raising its bid for the company by $1.75 per share to $7.25. Arch Coal Inc ( ACI ) plans to buy International Coal Group Inc. (ICO) for $3.4 billion.

Tenet Healthcare ( THC ) is trading lower although Community Health Systems ( CYH ) says it has raised its all-cash offer to acquire THC to $7.25 per share from $6.00 per share.

Shares of Sony Corp. (SNE) are higher after the electronics maker apologized for the breach of its Playstation Network and and Qriocity services. It also is aiming to restart the online gaming center by the end of this month, the report said. The service had been shuttered since April 20th.

AmeriGas Partners L.P. (APU), a retail propane distributor, today reported Q2 net income attributable to AmeriGas of $118 million, or $1.45 per diluted share, versus the prior-year period's $134.5 million, or $1.59 per diluted share. This falls below the Thomson Reuters expectation for earnings of $2.37. Current quarterly income includes the impact of an $18.8 million loss on the early extinguishment of debt.

TiVo (TIVO) is higher after it says it, DISH Network Corporation (DISH), and EchoStar (SATS) settled all of their ongoing patent litigation. Under the terms of the settlement, DISH Network and EchoStar agreed to pay TiVo $500 million, including an initial payment of $300 million with the remaining $200 million distributed in six equal annual installments between 2012 and 2017. TiVo, DISH Network and EchoStar agreed to dismiss all pending litigation between the companies with prejudice and to dissolve all injunctions against DISH Network and EchoStar.

Jackson Hewitt (JTX) is down after it said its lenders amended a credit agreement, delaying a principal payment and the possibility of a pre-packaged bankruptcy. The amendment extends the date by which the company has to make a $30 million principal payment, due April 30, to May 20, it said in a SEC filing, according to Reuters. The amendment also gives the company time until May 20 to work with the lenders to agree upon a 'mutually satisfactory restructuring' of its balance sheet, Reuters reports.

In earnings news:

--DISH Network (DISH) shares are up by double digits today on news that it more than doubled its profit compared with last year's, although it added fewer subscribers this quarter. DISH's net income attributable to common shareholders was $549.39 million, or $1.22 per share, compared with $230.95 million, or $0.52 from the same period last year. Analysts were looking for $0.68 per share, according to Thomson Reuters.

--EchoStar (SATS), a holding company that develops digital set-top boxes and offers satellite services, posted lower Q1 net income attributable to common shareholders of $17 million, or $0.19 per diluted share, compared with last year's $72 million, or $0.84 per diluted share. This falls below Thomson Reuters expectation for earnings of $0.28 per share.

Commodities are mixed. June gold contracts are up 0.56%, to $1,565 an ounce while June crude oil contacts are down 0.02% to $113.87 a barrel.

In energy ETFs, the United States Oil Fund (USO) is up 0.16% to $45.22 and the United States Natural Gas fund (UNG) is up 0.08%, to $12.07.

In precious metal ETFs, the SPDR Gold Trust (GLD) is up 0.17% at $152.63. Market Vectors Gold Miners (GDX) is down 1.38% to $61.34. iShares Silver Trust (SLV) is down 2.86% to $45.53.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright (C) 2014 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing , Commodities

Referenced Stocks: ACI , CEPH , CYH , TEVA , THC

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